by Laurie Merrill and Russ Wiles, The Arizona Republic

by Laurie Merrill and Russ Wiles, The Arizona Republic

PHOENIX -- Business leaders are reacting with concern over a potentially discriminatory religion bill passed by the Arizona Legislature, saying it could damage the state's recovering economy even as it readies for the potential boost it will get from hosting next year's Super Bowl.

The Greater Phoenix Economic Council on Friday urged Gov. Jan Brewer to veto the controversial legislation that would allow discrimination against gays, saying it could affect Super Bowl XLIX and have "profound, negative" economic effects for years to come.

Another group, the Greater Phoenix Chamber of Commerce, said it has no official position on SB 1062 at this time. "But our review of the bill raises concerns about the uncertainties this would create for our member businesses," the group said in a statement.

The controversy comes at a time when Arizona's economy was just starting to shift into higher gear. BMO Capital Markets, in a report this month, said Arizona's economy is poised to grow faster than the nation's both this year and next. Now those upbeat predictions are coming into doubt.

"The state already is known as being discriminatory," said Howard Fleischmann, majority owner of six Community Tire Pros and Auto Repair outlets in the Valley. "This would muddy the water and give Arizona a more terrible reputation."

Representatives of Arizona's tourism industry are worried, especially with hotel occupancy and other measures on an upswing and with the nation's biggest sporting event scheduled to touch down in Glendale early next year.

"We're greatly concerned," said Kristen Jarnagin, senior vice president of the Arizona Lodging & Tourism Association. "We've already received countless phone calls and emails from people canceling trips or threatening not to return."

Some critics already are calling for the NFL to move the big game to another state, she said.

ONE Community, an interactive web and events community for lesbian, gay, bisexual and transgender and allied individuals and businesses, urged the community to take action against the bill and ask the governor for a veto.

In a press release, the group said, "this institutionalized discrimination ... does real harm to the Arizona's commerce pipeline and businesses seeking to attract valued talent. The defeat of these bills will support the fundamental American ideal that individuals should be treated with dignity and respect rather than by prejudice and discrimination."

ONE Community provided several examples of potential harm:

â?¢ A taxi driver could refuse to drive someone to a synagogue because it goes against his religion.

â?¢ Women could be in danger of losing jobs because in some religions they are not equal.

â?¢ Restaurateurs could refuse to serve a Mormon family on the grounds that they disapprove of their religion.

More than 850 companies and nonprofit groups have signed a Unity Pledge encouraging diversity, including that for LGBT employees, according to ONE Community. These include large local employers PetSmart, Liberty Mutual, Allstate and Apollo Group. LGBT people represent $830 billion in combined annual spending across the nation, the group said.

In Jerome, Anne Conlon, owner of the Connor Hotel, said the bill sends the wrong message in light of Arizona's fight over celebrating Martin Luther King Day and the recent controversy over Senate Bill 1070, an immigration bill.

"We are going to send the message nationally that we are nothing but a bunch of rednecks, that we are all white and Christian," Conlon said.

Dennis Hoffman, economics professor at the W.P. Carey School of Business, said that in business, perception is reality. In Arizona, the perception might be that it would be challenging for businesses to attract good workers.

Hoffman said that outside Arizona, people ask, "What are you guys doing out there? What is going on? Why do you persist on policies that (are) going to be perceived nationally as unwelcoming?"

House Bill 2153, written by the conservative advocacy group Center for Arizona Policy and the Christian legal organization Alliance Defending Freedom, would allow individuals to use religious beliefs as a defense against a lawsuit.

Brewer has five days to sign, veto or ignore the bill and has not indicated her inclination.